Terms

Series

8.00% Series A Perpetual Strike Preferred Stock

Liquidation Preference

$100.00

Coupon Rate

8%

Rate Type

Fixed

Annual Dividend

$8.00

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

No

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness Including Convertible Notes, Dividend Senior Stock, Liquidation Senior Stock, All Liabilities And Capital Stock Of Subsidiaries; Pari Passu With: Dividend Parity Stock, Liquidation Parity Stock; Senior To: Class A Common Stock, Class B Common Stock, Dividend Junior Stock, Liquidation Junior Stock

Regulatory (Basel III) Call

No

Tax Classification

Other

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

7,300,000

Prospectus Summary

MicroStrategy Incorporated is offering 7,300,000 shares of its 8.00% Series A Perpetual Strike Preferred Stock ('STRK'), a perpetual, non-redeemable-at-a-fixed-date preferred with a $100 liquidation preference priced at $80.00 per share. Dividends are fixed at 8.00% per annum ($8.00/share annually, $2.00 quarterly), payable on March 31, June 30, September 30, and December 31. This security is cumulative — meaning unpaid dividends accrue with compounding interest at 8.00% and must be made whole before any common dividends can be paid — though the board retains discretion on declaration and may pay dividends in cash or class A common stock. Holders also have the right to convert into class A common stock at an initial conversion price of $1,000.00 per share. The perpetual strike preferred stock sits above MicroStrategy's common equity but is junior to all of the company's approximately $7.3 billion in outstanding debt (including multiple series of convertible notes), making it subordinate to a significant debt load at the holding company level. Additionally, since MicroStrategy is a holding company whose principal assets are held through subsidiaries, the preferred is structurally junior to all subsidiary-level liabilities — creditors of those subsidiaries have first claim on subsidiary assets before any value flows up to preferred holders. There is no regulatory capital call provision, but the company may redeem all shares if the aggregate liquidation preference outstanding falls below 25% of the original issuance amount, or upon a tax event, each at par plus accrued dividends. At the $80.00 offering price, the current yield is 10.0% ($8.00 annual dividend / $80.00 price). Payment dates are the last day of each quarter (March 31, June 30, September 30, December 31) with record dates on the 15th of each preceding month. Tax treatment is not definitively confirmed in the provided text, but as a C-corporation issuer, dividends may qualify for the preferential QDI rate for individual holders and the dividends-received deduction for corporate holders, subject to holding period and other requirements — investors should consult the full tax section. The dividend stopper is bilateral: MicroStrategy cannot pay common dividends if preferred dividends are in arrears; conversely, any future senior preferred stock could block preferred dividend payments entirely until made current.

Summarized from the SEC prospectus filing.

Distribution History

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full dividends on the perpetual strike preferred stock are not paid, MicroStrategy is barred from paying dividends on its common stock or other junior securities; conversely, any future dividend senior stock could block dividends on the perpetual strike preferred stock until that senior stock is made current.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 54 (Average)